Sen. Akaka on Why He Opposed the Minimum Wage Increase, Death Tax Repeal, Tax Breaks for Executives Traveling to Hawaii on Business with Spouse

”’Editor’s note: This is Sen. Daniel Akaka’s statement on why he opposed cloture vote on H.R. 5970 last Thursday. The bill, backed by Congressman Neil Abercrombie, D-Hawaii, in the House, would raise the federal minimum wage by $2 an hour, make the death tax repeal permanent and give tax breaks to executives who bring their spouse to Hawaii while on business. The move for cloture, which requires 60 votes, was defeated in the Senate.”’

Mr. President, it pains me to have to choose between
the urgent needs of important groups in my constituency, which is why my decision to oppose cloture on the so-called “trifecta bill,” combining an estate tax compromise, minimum wage increase, and tax extenders, is a difficult one for me.

However, it is one that I find to be necessary.
There are some good measures in this bill, particularly in the tax
extenders package.

I applaud my colleague in the House, Representative
Neil Abercrombie, for his hard work to reinstate a tax deduction for spousal
travel that is included in this package. It would have a positive
effect on tourism-based economies, such as Hawaii’s economy.

I also appreciate
the extension of the Research and Development credit and higher education
above-the-line deduction, among other provisions. However, on balance,
as with so many other large legislative vehicles that we consider on this
floor, it is not enough to convince me to support the overall package.

I am disheartened that the majority in Congress uses the plight of
our low-income and disadvantaged to better the cause for the wealthiest
among us.

For years, I, along with my Democratic colleagues, have offered
amendments and introduced free standing bills to increase the national
minimum wage rate for our working men and women.

If those in Majority
Leadership are serious about increasing the wage rate, then they should
pass free standing bills that are currently pending action in both the Senate
and the House of Representatives.

This is truly an outrage that the
majority has stooped so low to do this, and to take such a cynical view of the
support that a minimum wage increase truly has in our country.

The package before us further disappoints me because its tip
provisions will actually hurt many of those who could use a boost in wages.
Restaurant staff, valets, parking attendants, bartenders, maids, and others who
support themselves or their families on tip wages will have current protections
taken away by this bill.

States that want to guarantee a higher floor
for tip wages would see their power to do so nullified. These hardworking
Americans deserve to have the wage protections that their states want to
grant them.

On the estate tax, I have heard most passionately from auto dealers
in Hawaii of the tragedies that could occur if the estate tax is not
eliminated or scaled back. Hawaii, as with other states, has lost numerous
family-owned businesses due to a number of factors.

Our auto dealers,
farmers, ranchers, and other family-owned entities fear that they will
not have the resources to keep their businesses in the event of the deaths
of current owners, if the estate tax is not repealed or rolled back.

All of these concerns are heartfelt. I must assure those who have
written that I have heard them and have taken their experiences and
views into consideration while deciding what position to take on this matter.

I have wanted to help them.

However, Mr. President, the vote on cloture
on H.R. 5970 can also be a missed opportunity to serve countless others in
our home states and many who have not yet been born.

I am talking about
opposing cloture on a bill that would mortgage future generations by
adding more than $300 billion to already alarming federal deficits.

According to the Joint Committee on Taxation, provisions to
increase the estate tax exemption and link estate tax rates to the capital gains
tax rate would cost nearly $268 billion over 10 years. Add that to
extensions and expansions of several expiring tax relief provisions, some of which
we must pass, and the bill’s cost is $306 billion over 10 years.

The
minimum wage increase would have a negligible revenue effect.
My colleague from North Dakota, Senator Conrad, has instructed this
body time and time again on the dire fiscal picture that we are facing
on the federal level.

Our Budget Committee Ranking Member noted yesterday
that our federal debt increased by $551 billion last year and is projected to
increase another $600 billion this year. Mr. President, these figures
are shocking to me, and they will doubtlessly translate into hard decisions
on programs that we already have a hard time funding yet are so essential
to each of our communities.

In fact, the Center on Budget and Policy Priorities notes that,
should pending budget process reforms be put into place, the combined effect
with the implementation of estate tax provisions would be to force drastic
cuts in various entitlement programs that serve seniors, low-income families,
veterans, students, and the disabled. Some of the programs that CBPP
notes would surely be on the chopping block to make up for estate tax revenue
losses include Medicare for seniors, SCHIP for children, federal
civilian retirement, the Earned Income Tax Credit for lower-income families, the
child tax credit, military retirement, unemployment insurance,
Supplemental Security Income for the elderly and the poor, veterans disability
compensation and pensions, Food Stamps, school lunch and child
nutrition, and farm programs.

It is because of drastic impacts like this that I have heard from
hundreds of other constituents who want me to vote to save these
necessary programs and others in education, health care, and social services that
would bear the brunt of further reductions in discretionary funding. I
simply cannot put the needs of many above the needs of a few, even if
they are a well-deserving few, which is why I cannot support cloture on this
package before us.

Once again, Mr. President, the choice to oppose cloture on this
measure has been a tough one for me. It is far better than estate tax repeal in
its projected fiscal outcome, and I thank its authors for their willingness
to compromise to a certain point. However, the bill does not go far enough
for me.

I deeply appreciate hearing the arguments put forth on both sides
of this debate and the work put in on this matter, but I cannot support
this cloture motion. I yield back the balance of my time.

”’U.S. Sen. Daniel Akaka is a Democrat representing Hawaii.”’

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